In Cattaraugus County it also plays an important role, serving as the major connection from Olean to the Southern Tier Expressway (Interstate 86 or I-86 and NY 17).

NY 16's current alignment south of Olean was originally designated as New York State Route 16A around this time.

On the other side, it becomes a four-lane road with a divider as it approaches NY 17, currently concurrent with I-86 pending the entire expressway's upgrade to Interstate Highway standards.

But NY 16 runs parallel to the freeway and remains a four-lane route, although no longer divided, following the Olean valley.

The highway veers to the northeast in Machias, turning back to the north at the resort hamlet of Lime Lake.

A straight course takes the highway from this junction through the village of Delevan and to the Cattaraugus Creek bridge.

After joining the expressway for two miles (3 km), it again leaves to become a two-lane that enters East Aurora as Olean Street.

[5] At Willardshire Road as the highway passes the industrial parks and other facilities associated with local company Moog Inc. North of the village, it enters the Town of Elma and becomes Seneca Street, the name it will retain all the way to the city.

Immediately afterwards it crosses I-190 with no exit (but with northbound access) and returns to a more east–west course through industrial areas before ending at Main Street, NY 5, in the city center.

NY 16 was rerouted to follow the new highway for two miles (3 km) before exiting the freeway and returning to its previous alignment.